Section 8-40-201(19) provides that the term \u201cwages\u201d shall include \u201cthe amount of the employee\u2019s cost of continuing the employer\u2019s group health insurance plan and, upon termination of the continuation, the employee’s cost of conversion to a similar or lesser insurance plan.\u201d<\/p>\n\n\n\n

Recently, an employer raised an interesting defense to the claimant\u2019s request to increase his Average Weekly Wage to reflect the cost of conversion under COBRA. Fortune v. Restaurant Technologies, Inc.,<\/em> W. C. No. 4-915-420-01 (January 30, 3015). In Fortune<\/em>, upon separation of employment the claimant received a notice pursuant to COBRA that his cost of continuing his health insurance was $1,086.22 (which converts to a weekly cost of $271.56). The employee chose not to continue his health insurance under COBRA, and requested the respondents increase in his Average Weekly Wage by the weekly cost of $271.56. At the hearing, the respondents presented evidence that the employer offered to pay an undisclosed portion of the claimant\u2019s total cost of continuing insurance coverage, and argued that the claimant\u2019s Average Weekly Wage should be increased only by the weekly amount the claimant would have had to pay if he had elected to continue his coverage.<\/p>\n\n\n\n

The Administrative Law Judge rejected the respondent\u2019s legal argument and awarded an increase in the Average Weekly Wage to reflect the full weekly cost of continuing the claimant\u2019s health insurance coverage. The respondents appealed to the Industrial Claim Appeals Office, who affirmed the decision of the Administrative Law Judge, stating \u201cApplied to another case, that argument may have merit. In this matter however, the respondents admit the employer \u201cwould have paid\u201d a portion of the premium \u2018if\u2019 the claimant had elected to continue to pay his portion of the premium pursuant to the COBRA notice. However, the respondents then observe that the \u2018claimant did not elect a COBRA plan.\u2019 Accordingly, the respondents did not continue to pay any health insurance premium.\u201d<\/p>\n\n\n\n

As support, the ICAO referenced that portion of \u00a78-40-201(19) which provides \u201cIf, after the injury, the employer continues to pay any advantage or fringe benefit specifically enumerated in this subsection (19), including the cost of health insurance coverage or the cost of the conversion of health insurance coverage, that advantage or benefit shall not be included in the determination of the employee’s wages so long as the employer continues to make payment.\u201d The ICAO then found that, because there was no evidence that the employer continued to pay the cost of the claimant\u2019s health insurance coverage \u201cthe fact that the claimant did not actually continue his health insurance coverage is inconsequential to whether the AWW should include the amount of the claimant\u2019s cost of continuing an employer\u2019s group health insurance plan.\u201d Industrial Claim Appeals Office v. Ray<\/em>, 145 P.3d 661 (Colo. 2006)(claimant\u2019s AWW must include cost of continuing employer\u2019s group health insurance plan regardless of whether claimant purchased the insurance).<\/p>\n\n\n\n

However, it appears that the ICAO focused on the wrong part of \u00a7 8-40-201(19)(b) because it failed to comprehend the respondent\u2019s argument. The portion of the statute cited by ICAO is not relevant to a determination in this case, because that section states only that the cost of health insurance shall not be included in the AWW if the employee does not continue coverage. The respondents, however, were not arguing that the AWW should not be increased at all. Rather, the respondents admitted that the AWW should be increased, and instead were arguing that, because the employer offered to pay a portion of the employee\u2019s cost of continuing the claimant\u2019s health insurance, under \u00a78-40-201(19)(b) the true cost to the employee of continuing his health insurance was only that amount the employee would have had to pay if he had elected to continue coverage.<\/p>\n\n\n\n

It is not clear whether this case will be appealed to the Court of Appeals. However, I do not believe that this case should discourage respondents from making a similar argument in a similar case, as it appears that the ICAO decision is not well reasoned.<\/p>\n","protected":false},"excerpt":{"rendered":"

Section 8-40-201(19) provides that the term \u201cwages\u201d shall include \u201cthe amount of the employee\u2019s cost of continuing the employer\u2019s group health insurance plan and, upon termination of the continuation, the employee’s cost of conversion to a similar or lesser insurance plan.\u201d Recently, an employer raised an interesting defense to the claimant\u2019s request to increase his… Continue reading Employee\u2019s Cost of Converting Health Insurance Under COBRA<\/span><\/a><\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-314","post","type-post","status-publish","format-standard","hentry","category-uncategorized","entry"],"_links":{"self":[{"href":"https:\/\/epicdevsite.info\/2021-picardilawfirm2\/wp-json\/wp\/v2\/posts\/314","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/epicdevsite.info\/2021-picardilawfirm2\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/epicdevsite.info\/2021-picardilawfirm2\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/epicdevsite.info\/2021-picardilawfirm2\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/epicdevsite.info\/2021-picardilawfirm2\/wp-json\/wp\/v2\/comments?post=314"}],"version-history":[{"count":1,"href":"https:\/\/epicdevsite.info\/2021-picardilawfirm2\/wp-json\/wp\/v2\/posts\/314\/revisions"}],"predecessor-version":[{"id":315,"href":"https:\/\/epicdevsite.info\/2021-picardilawfirm2\/wp-json\/wp\/v2\/posts\/314\/revisions\/315"}],"wp:attachment":[{"href":"https:\/\/epicdevsite.info\/2021-picardilawfirm2\/wp-json\/wp\/v2\/media?parent=314"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/epicdevsite.info\/2021-picardilawfirm2\/wp-json\/wp\/v2\/categories?post=314"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/epicdevsite.info\/2021-picardilawfirm2\/wp-json\/wp\/v2\/tags?post=314"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}